Increased import taxes drive Gaza auto dealers around the bend
Auto dealers in the Gaza Strip are facing a double taxation policy that is slashing their profits, amid an already precarious industry and deteriorating living conditions.
GAZA CITY, Gaza Strip — The Hamas-affiliated Ministry of Finance imposed a 25% tax on imported cars in the Gaza Strip in early June, raising the ire of auto dealers, who suspended all import activity.
The auto dealers association in the Gaza Strip decided during an emergency meeting held June 6 to halt the importation of vehicles until the ministry backs down on its decision.
Ismail al-Nakhaleh, who heads the association, told Al-Monitor, “The Ministry of Finance in Gaza imposed a 25% tax on imported cars early June 2015 despite the fact that traders are paying a 50% purchasing tax to the Palestinian Authority [PA] and a 7% profit tax.” This means that auto dealers would have to pay taxes amounting to 82% of the original price of the car.
Nakhaleh condemned the decision, and said, “This business is no longer profitable because of the double taxation policy [faced by] traders, who pay taxes to the PA in Ramallah and taxes to Hamas in Gaza, which led to a significant rise in car prices and paralyzed the purchasing [power] in automobile markets.” Nakhaleh said 440 new cars per month are imported into Gaza.
